Financial Authority Guidelines gif

Bursa

Malaysia’s role

in the development of the Malaysian

Islamic Capital Markets

Authors: Raja Teh Maimunah Wan Rizaidy

Malaysia’s 30 years of Islamic finance experience was encap- sulated into a single initiative in August 2006; the Malaysia International Islamic Finan- cial Centre (MIFC) initiative to further promote Malaysia as a major hub for international Islamic finance following a promising development in the national Islamic Capital Mar- kets.

The MIFC is a collaborative effort by the country’s financial and market reg- ulators, including the Central Bank of Malaysia, Securities Commission (SC) of Malaysia, Labuan Offshore Financial Services Authority and Bursa Malaysia (Exchange).

The efforts in promoting national Is- lamic Capital Markets were first seen with the introduction of Shari’ah compliant equities in 1996. The eq- uities screening pioneered by the SC’s Shari’ah Advisory Council (SAC) opened a new landscape in Shari’ah compliant investment. To date, Bursa Malaysia hosts 848 Shari’ah compli- ant listed equities comprising 88% of the total listed companies with a mar- ket capitalization of RM 521.24 billion (as at 30 June 2009).

In meeting the global Shari’ah require- ments and standards, the Exchange and FTSE Group joined forces on 26 June 2006 to launch the FTSE Bursa Malaysia Index Series which include

FTSE Bursa Malaysia Shari’ah index series; FTSE Bursa Malaysia Hijrah Shari’ah Index and FTSE Bursa Ma- laysia EMAS Shari’ah Index. Under the FTSE Bursa Malaysia Shari’ah index se- ries, listed equities are screened using FTSE’s global standards of free float, liquidity and investability and Yasaar’s international Shari’ah screening meth- odology in addition to SAC’s screening methodology. The introduction of the two Shari’ah indexes is to ensure the exchange complies with not only do- mestic market requirements but also global standards.

The development of Shari’ah compli- ant equities and indexes has driven the Malaysian Shari’ah fund and unit trust industry. It has also attracted a number of established global fund management companies to set up their regional Islamic fund Management companies in Malaysia. The continued interest and global participation by var- ious parties have contributed positively to the Malaysian Islamic Capital Mar

Wan Rizaidy, Bursa Malaysia

Wan Rizaidy has some 8 years of experience in both capital markets and Islamic finance rang- ing from regulatory body to international foreign banks. His area of focus is on Shari’ah compli- ant investment and financing products and serv- ices including Islamic hedging solutions. Prior to joining Bursa Malaysia, he worked with various institutions including Kuwait Finance House (Ma- laysia) in International Business & Distribution, Standard Chartered Saadiq in Origination & Cli- ent Coverage, and the Securities Commission (SC) of Malaysia in Market Supervision, Islamic Capital Market and Development. He is a facili- tator for Graduate Islamic Finance Training Pro- gramme by the Central Bank (FSTEP) and the SC (CMGTS). He is a former member of various working committees for Islamic finance by the SC, Central Bank and Islamic Financial Services Board (IFSB). He successfully led the launching of Electronic Reporting System “ERS-ELA” for Ma- laysian Capital Market Intermediaries (SC) and was involved in the structuring of a Shari’ah com- pliant Commodity Linked Investment & Liquidity Management in Australia. Wan Rizaidy holds a Bachelor of Economics (Hons) degree from the International Islamic University Malaysia.

2010 June GlobalIslamic Finance 49 Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60  |  Page 61  |  Page 62  |  Page 63  |  Page 64  |  Page 65  |  Page 66  |  Page 67  |  Page 68  |  Page 69  |  Page 70  |  Page 71  |  Page 72  |  Page 73  |  Page 74  |  Page 75  |  Page 76  |  Page 77  |  Page 78  |  Page 79  |  Page 80